Comments on: Stumped by a Low Appraisal

By: Anonymous

Anonymous — Fri, 15 Apr 2011 15:23:43 +0000

Hi. Low appraisals are happening all across the country! In fact I just purchased a home in California and the appraisal came in 10,000 dollars lower than contract price. In most cases the banks don't want to come down in price because they already are at rock bottom pricing. I got fortunate. Our only hope was the bank dropping price to meet the appraisal and they just did a price drop of 10,000 before we got into contract. They did agree to drop another 10,000 to meet the appraisal and we were able to close the deal. They did require us to pay 1,000 more in closing costs and took away the home warentee they were going pay for in the beginning. We got very lucky because if the bank would not have dropped the price we would have lost the home sale! Low appraisals are deal killers across the country. Apprisals are comming in low because they are basing the compariables on distressed property because there are so many distressed. Propertys now sometimes its the only comp they can find. Low appraisals are killing deals EVERY where! This is hurting our econmony. Perfectly qualified buyers are not able to buy homes due to low appraisals! Hopefully this trend will end soon!

By: One Frugal Girl

One Frugal Girl — Sat, 16 Oct 2010 15:39:02 +0000

@Anonymous – The seller wasn't willing to drop the price. The appraisal was just wrong and he wasn't about to budge to meet it.

By: Anonymous

Anonymous — Fri, 15 Oct 2010 20:20:18 +0000

I know that this is an old posting, but here's my 2 cents: you were lucky the appraisal came in so low. It gives you negotiating power. If the appraisal was low for you, will it change for anybody else? Offer less and see what the sellers say. It's a buyer's market.

By: James Ebert

James Ebert — Tue, 10 Nov 2009 15:32:16 +0000

Hi,
As a 20 year appraiser, I am seeing this over and over. National lenders have the lowest rates and atractive offers, but they then use an appraisal management company, co-owned by the bank, which is making money from the appraisal as well. Explore smaller banks, local brokers and even local waterfront expert appraisers, who can help you look at other lenders, who will use a high quality expert on your valuation. Trainees often will work for 50% of normal fees, and they are totally lost in this market. James Ebert Westlake Village, CA

By: Anonymous

Anonymous — Tue, 10 Nov 2009 14:37:00 +0000

I have had a problem with a low appraisal as well. My thought on this is that with the collapse of the housing boom there have been a lot of lawsuits against appraisal companies for supposedly overvaluing homes (to allow mortgage loans to go through). Later, the house value tumbled and home owners and buyers of mortgage backed securities got screwed and sued the appraisers. The appraisers are probably trying to be very conservative as a result.